What do you do on these days? Where can you hide? — Seriously, I’m asking for a friend ha… but, as most of us here are retail clients – (generally buying more than selling), — what do you do on these days?
As the Major indices drop about -3% across the board in one session — One begins to wonder if 500 pt Dow and 60 pt ES days are the new “normal”… One thing is for certain, look at any chart and you can see that volatility is back… or coming back. Look at the VIX (Or the TRIN today!) — The chart has more than doubled off the lows in the past few sessions. As the title of the blog and the opening paragraph allude to — I am seeking the answer to the almighty question: What do you do when there is blood on the streets and there is no bid — anywhere.
Except — “kind of” a fake or small bid in Gold… but maybe the CBs are just trying to scalp day traders intraday.
One thing that did make sense, and I mentioned it at the end of yesterdays blog “(I still think Gold GC is the next “market” to make a significant move (or maybe I am positioned for that).” — I was and still am awaiting Gold GC’s next rally, it has been a long time since the yellow safe haven could sustain a squeeze higher… But if stocks are crashing and the USD has paused for the moment (as fed snoozes and becomes more cautious) — where else do I want to put my money? So I guess the answer to “Where do you hide? — Only you know the answer. But as far as myself — I am hiding in Gold and similar precious metals, (as well as other oversold commodities or fx). But as you see on a day like today, Stocks down, Copper down, Coffee down, Soybeans down, Dollar down, Crude down, for the most part — It didn’t really matter what the ticker was, over 90% of the SP500 was in the red it seemed. …When there is blood on the streets, and you can smell/see the fear, its unfortunate because usually (we can get caught up in it) — but as we are here to trade futures, take a second and think about where we were last week, or even this Sunday (in whatever market it is that you trade) — and think about: Where is it going to be tomorrow, and can I “hide” in it while extremely volatile price discovery is rippling into every/any market, regardless of correlation, or reason. (I am less focused now on trying to “day trade – time the market”, and more focused on how to best manage risk around my oppinions of future movement – for tomorrow). Basically, as I gain a little bit more of a LT perspective or approach, I can avoid the noise “blowing me out” or forcing trades when I want them in the moment, – best to hide out in a “safer” place like IMO GC here, until I feel comfortable jumping big elsewhere. (If I only had GC on tho, ha…)
The goal in futures is to make money, and most importantly this is done by “Living to trade another day”, these are incredibly wild times in the futures market (and as mentioned other markets), the goal is to stay in the game, sometimes you will have to play defense and defend your positions, it won’t always be a bull party. BUT — The best traders can stick around for when the party returns.
Let’s try again tomorrow. – Happy Trading.
-Bret Rosenthal